News Today

Sheikh turns to Arsenal
ARSENAL could be a &pound450 million (S$1.35 billion) target for Sheikh Mohammed Rashid Al-Maktoum. The world's fifth-richest man, with a personal fortune of &pound7 billion, is reportedly eying the Gunners. He had been snubbed by Liverpool last week in favour of... [Read more]

Blowing hot and cold
WASHINGTON - UNITED States President George W. Bush and Iranian leader Mahmoud Ahmadinejad have sparred - albeit separately on American television - as both sought to defuse speculation about an impending military confrontation between the two countries. Mr Bush dismissed talk... [Read more]

Serving up a hot, steamy cup of coffee in foreign lands
IN UKRAINE, sex sells coffee. That's what Singapore company Food Empire discovered. One of the most popular television commercials for the company's MacCoffee product features a beautiful, long-haired woman in red hot pants driving up to a bar in the middle... [Read more]

Putin throws down gauntlet to West
THE annual security conference in the southern German city of Munich is traditionally a venue where defence leaders showcase their plans for making the world a more stable place. Not the one held last weekend, however. For in a speech which... [Read more]

Leadership courses for social workers
SOCIAL workers will soon be able to take paid leave to attend leadership training courses. It is part of a $1 million Social Work Professionalisation package, aimed at helping social workers develop and grow their professional skills. Minister for Community Development,... [Read more]

Thigh strain rules Vieira out of Valencia match
MILAN - INTER Milan midfielder Patrick Vieira will not play in today's Champions League first-leg match against Valencia after aggravating a thigh strain in training.The French international, who missed Inter's 1-0 win over Cagliari at the weekend because of the injury,... [Read more]

Tighter laws on handling bomb-making chemicals
TERRORISTS are increasingly using certain industrial chemicals such as ammonium nitrate to make explosives. In view of the security risk, Parliament passed a new law yesterday that requires businesses or individuals dealing in and handling such chemicals to get a licence... [Read more]

SCCCI looks at club to cultivate bicultural Chinese S'poreans
IT MAY be 100 years old, but the Singapore Chinese Chamber of Commerce and Industry (SCCCI) is open to ideas as to how it can continue to remain relevant. And top government leaders have provided some suggestions in a book, entitled... [Read more]

Shorter lead time for GST hike may cost more for firms
THE bad news: Singapore firms may have to pay more to implement the latest hike in the goods and services tax (GST) given the shorter deadline than for the last rise. The good news: Many firms have already started gearing up... [Read more]

Fate of sand importers hangs in the balance
BARGES carrying thousands of tonnes of sand are unloaded every day at landing terminals in Pasir Ris and Tuas. But in just over a week, this could grind to a halt as Indonesia's ban on land sand exports kicks in after... [Read more]

Thai-language media cries foul, reflects bitterness over loss
BANGKOK - THAI-LANGUAGE media yesterday cried foul over the country's loss to Singapore in Wednesday's Asean Football Championship match. Singapore beat Thailand 2-1 in the first-leg of the final, a match marred by a 15-minute walkout by the Thais, who were... [Read more]

Frequent flyer programme Krisflyer has a long way to go

I would like to relate my experiences with Singapore Airline's frequent flyer programme, Krisflyer, and British Airway's equivalent, Executive Club.

Having lived in London for a few years and travelling to Singapore at least once a year to visit family and friends, I was naturally biased towards flying with Singapore Airlines and becoming a Krisflyer member.

My experience over the years with Krisflyer has been disappointing. Being a Krisflyer member, I try to stick to flying with Star Alliance members whenever I am unable to fly with Singapore Airlines. Without fail, I will need to submit a 'Retroactive Mileage Claim' every time I have flown with a partner airline, despite the fact that my Krisflyer membership number is included in the booking.

When I have accumulated sufficient miles to qualify for an upgrade, trying to do so has also proven to be a nightmare. Despite calling up six months in advance, I am invariably told that the flight I want to upgrade to is fully booked.

I can understand that for popular flights, the airline wants to keep as many seats as possible for fare-paying passengers, but there seems to be a certain amount of rigidity in the way Krisflyer handles upgrade requests.

On one occasion, I booked a Business Class Virgin Atlantic ticket from London to Singapore. This is a code share deal with Singapore Airlines and I flew on a Singapore Airlines plane. Again, my Krisflyer membership number was clearly stated in the booking.

However, when I completed my flights, not only were my miles not automatically credited, but I was also told via the website that my ticket did not qualify for miles. I had to call Krisflyer several times and, on each occasion, I was given different answers with regards to the accrual of miles.

One told me that I should get the miles and she wasn't sure why I haven't. Another told me that it was under investigation. Even checking my account online regularly showed different comments against my claim.

In the end, I had my miles credited to my account, but it took a long while and a lot of intervention on my part. This proved to be the final straw and I switched to British Airways afterwards.

I have been an Executive Club member for about six months and the experience cannot be more different.

While the miles for my British Airways flights were credited within 24 hours of my flight, miles for my Cathay Pacific flights were also credited within a week - and I didn't have to submit a claim.

What was more impressive was my submission for miles that were missing after a stay at a hotel. The whole process was very simple and my miles were credited to my account 48 hours after I had sent the required invoice off to British Airways.

While I agree that the British Airways product is not as good as the Singapore Airline product, but the two things that work in their favour are a frequent flyer programme that works seamlessly and a Business Class seat that reclines to a fully flat bed that allows a good night's sleep.

While I am encouraged to see Singapore Airlines upgrade its Business Class product on its Boeing 777-300 fleet, I hope that when the Airbus 380 is rolled out, it will take a leaf out of British Airway's book and provide a fully flat bed in Business Class.

More importantly, Krisflyer needs to be a lot more efficient and not have passengers spend more energy chasing for missing miles than is normal.

Alvin Sim Khim Woon

London, United Kingdom

Geylang start with 1-0 victory

AFTER three seasons of under-achievement, Geylang United might just be on the brink of a new dawn.

Last season's second-last side got off to a winning start at the Jurong West Stadium yesterday.

They beat Gombak United 1-0 in front of 2,669 fans.

Under coach Lim Tong Hai, who is beginning his first full season in charge, the Eagles look a different proposition from the side that conceded 62 goals last season.

They were tight and well-organised at the back. Up front, they took their chances well despite missing the injured Briton Kim Grant and Dutchman Abdelaziz Dnibi.

Former national defender Lim said: 'The players worked hard and rose to the occasion. We coped with the pressure and worked well as a team.

'It was a deserved win and it's always nice to keep a clean sheet.'

Their backline of national skipper Aide Iskandar (who moved from Tampines Rovers), Razaleigh Khalik, Noh Rahman and Jonathan Xu repelled everything Gombak could muster.

In fact, the hosts, who finished eighth last season, failed to register a single shot on target the entire game.

All Gombak had to show in the first half was a Ruhaizad Ismail shot which flashed just wide.

And it was only in stoppage time that Gombak's Thai midfielder Theerawesin Seehawong managed his side's first shot on target, which Geylang goalkeeper Fajar Sarib saved easily.

Striker Agu Casmir, who received the go-ahead to play only on Wednesday after missing the registration deadline, also failed to make any headway against the Geylang defence.

The Eagles also took some time to warm up at the attacking end.

But, when they did, they looked the more potent side.

Geylang took the lead on 35 minutes through midfielder Syed Fadhil with a 30-metre thunderbolt past Gombak goalkeeper Adi Salleh into the top- right corner.

Despite two floodlight failures which stopped the game for some 12 minutes, Geylang's raucous bunch of about 50 supporters made the most noise.

If this first match is anything to go by, they should have more reason to cheer this year.

Meanwhile, Singapore's under-21 side crashed out of the Asean Youth Championship in Brunei yesterday.

They lost 0-2 to Malaysia in their final group game.

Air Asia did not allow me to carry my cabin-sized bag onto plane

In recent times, budget airlines have made vacationing more affordable for Singaporeans. During the Chinese New Year rush, it was almost impossible to book a flight to popular vacationing spots with conventional airlines. So, budget airlines took the opportunity to raise fares.

Left without a choice, I paid a premium fare of close to $700 for two to fly Air Asia to Bangkok when Singapore Airlines was charging about the same price on a 4-to-go basis. But paying full fare does not mean you get service that is up to par. After all, I was still flying on a budget airline.

Air Asia confirmed my greatest fear of lost baggage. On the flight returning from Bangkok, the ground staff stopped me from bringing my small cabin bag on board. When asked for the reason, she claimed that my bag was not of cabin size. I pointed out other passengers with larger bags and she came up with another excuse that the flight was full and there was no room.

I agreed to check my small bag in but asked for a 'Fragile' label due to the breakable contents in my bag. Without hesitation, she said there were no such labels.

Getting irritated by the customer-unfriendly attitude, I insisted that I will not check in my bag unless they marked it as 'Fragile'. With much resentment, she then produced a luggage label and asked me to sign. I did so. As she was attaching the label to my bag, I saw her mark 'Late Check-in'.

Upon arrival in Singapore, my bag could not be found but my travelling partner could find hers. She, too, checked in at the gate along with my bag.

Is there a new policy to forbid carry-ons on Air Asia flights?

I fly on business frequently and am fully aware of what cabin-sized carry-on bags should be and have ensured that I observe the rule for carry-ons.

Lynn Lam Wai Ling (Ms)

Insiders scoop up bargain buys during bourse's plunge

AS SHELL-SHOCKED investors were rushing to bail out of the plunging market, canny executives here were snapping up bargain-priced shares in their own firms.

'Insiders' from at least 28 listed firms have bought shares on the open market since the local bourse went into a freefall last week, according to Singapore Exchange filings.

Buyers include bank tycoon and UOL Group's non-executive chairman, Mr Wee Cho Yaw; Kim Eng Holdings executive director Ong Seng Gee; Mr Robert Chandran, chairman of recently listed Chemoil; and Singapore Press Holdings (SPH) non-executive director Lee Ek Tieng.

And cash-rich firms such as OCBC Bank and rice-cracker maker Want Want Holdings have been nibbling at their own shares on the open market, armed with mandates from shareholders for stock buy-backs.

CIMB-GK research head Song Seng Wun said yesterday that purchases by insiders when markets nosedive are often a reflection that a firm's valuation might be out of line with what investors may be willing to pay.

'Buying when everyone is panicky sends a strong signal to other investors that I have faith in my company, and I am now putting my money where my mouth is,' he said. This is especially true of the many small listed firms, which are at risk of a bigger whiplash during a market meltdown compared to blue chips.

The pattern of buying during this bourse bloodbath differed from company to company.

OCBC was buying throughout the index tailspin, according to online financial portal Shareinvestor.com.

The bank bought a total of 882,000 shares at between $8.20 and $8.90, as its stock price tumbled by as much as 6.7 per cent over the six-day losing streak.

But most firms made the bulk of their purchases during the panic two days ago, triggered by fears that global investors who had borrowed heavily in yen to fund asset purchases might have to dump their investments in light of the rising value of the Japanese currency.

Want Want bought 240,000 shares at US$1.41 to US$1.42 as its stock fell 2.76 per cent on Monday. It closed 3.6 per cent up at US$1.46 yesterday.

Broker Kim Eng bought back 100,000 of its own shares at $1.47 apiece on Monday. A private firm linked to Mr Ong bought 200,000 Kim Eng shares at $1.50 apiece on Monday and another 200,000 shares at $1.4806 each yesterday.

He also bought 70,000 shares at $1.50 each, under a DBS Nominees account on Monday. The shares closed 0.7 per cent higher at $1.48 yesterday, after falling 2.65 per cent on Monday.

Mr Wee was also in the thick of the action, buying more shares in property giant UOL. Last Wednesday, the day the Straits Times Index plunged by as much as 192 points at one stage, his investment vehicle, CY Wee & Co, bought 4.78 million UOL shares in 'a series of purchases'. No price was given.

The following day, it followed up with a purchase of 2.22 million shares at $5.032 apiece. The two transactions raised Mr Wee's deemed interest in UOL to 27.78 per cent.

Some insiders also accumulated shares in China ship-repair play Cosco.

These included Ms Mina Chan, wife of independent director Wang Kai Yuen. She picked up 200,000 shares at $2.39 apiece on Monday as the counter plunged 10 per cent.

Mr Lee Fook Choy, a director of Cosco's marine engineering unit, bought 300,000 Cosco shares at $2.656 last Friday. Cosco rose 4.2 per cent to $2.50 yesterday, making it one of the top gainers in percentage terms among STI stocks.

Mr Chandran bought 500,000 Chemoil shares at 51 cents each on Monday, while United Fiber System's chief executive, Mr Jaka Prasetya, snapped up one million of his firm's shares at 25 cents apiece on Friday.

Mr Lee Ek Tieng bought 50,000 SPH shares at $4.20 apiece on Monday.

engyeow@sph.com.sg

Skater gets ban for criticising coach

BEIJING - CHINA'S Olympic gold-medal speedskater Wang Meng has been punished for criticising her coach at the Asian Winter Games in January.

She has been banned from the two world championships this month for criticising new team coach Li Yan.

Wang, who won Olympic gold in the 500-metre short-track event at the 2006 Turin Olympics, will miss the World Short Track Speed Skating Championships and the World Team Championships.

'Wang Meng's improper comments about the team's head coach had a negative effect on the whole team,' said a statement from the Winter Sports Administrative Centre yesterday.

'The centre has asked her to reflect deeply on her mistakes and make a written apology.'

Wang, one of only four Chinese winter athletes to have won an Olympic gold, is something of a maverick and China's sports officials are notoriously unforgiving of public criticism.

'It was irresponsible to make such remarks,' the 21-year-old athlete said in her apology.

'My mistakes tarnished the image of the team.

'I'm so sorry. I accept the punishment.'

Li, who once coached the US team, said she would try out younger skaters at this month's world championships in Italy and the team championships in Hungary.

ASSOCIATED PRESS, REUTERS

News Today

Doc to testify on effects of alcohol on accused
A DOCTOR has been found to testify on the effects of alcohol on the man dubbed the 'One-eyed Dragon' on the day nightclub boss Lim Hock Soon was fatally shot.As a result, the trial of accused gunman Tan Chor Jin, expected... [Read more]

Serving up a hot, steamy cup of coffee in foreign lands
IN UKRAINE, sex sells coffee. That's what Singapore company Food Empire discovered. One of the most popular television commercials for the company's MacCoffee product features a beautiful, long-haired woman in red hot pants driving up to a bar in the middle... [Read more]

Bush's last stand
WASHINGTON - US PRESIDENT George W. Bush will be making his last stand. His State of the Union address on Tuesday night (Wednesday morning Singapore time) could make or break his presidency. And the pivotal issue is none other than Iraq... [Read more]

Leo Burnett eyes growth with fresh hires, new media
THE Leo Burnett advertising agency here has had its setbacks in recent years, but one of its top global executives has a plan for turning the agency around. Mr Mark Tutssel, chief creative officer of Leo Burnett Worldwide, believes that hiring... [Read more]

British teens urged to learn Mandarin, Urdu
LONDON - THE British government has embarked on an initiative to boost the economy through the learning of 'economically useful' languages.These are expected to include Mandarin and Urdu, alongside the traditional favourites of French, German and Spanish. In the first part... [Read more]

Social workers ought to get higher pay with extra funding
I REFER to the letter, 'Pay increase for social workers lauded' (ST, Jan 25), by Mr Edmund Lim Wee Kiat. We agree with Mr Lim that social workers play an important role in maintaining and improving the well-being of our society.In... [Read more]

Anti-spam Bill aims to get marketers to label messages
MARKETERS who send unsolicited e-mail and SMS messages will soon have to label their messages clearly or risk facing legal action from consumers.Under the Spam Control Bill, which takes its name from the widely-known act of 'spamming' - the sending of... [Read more]

Singapore, Uzbekistan sign deals to boost ties
SINGAPORE and Uzbekistan yesterday signed a series of agreements to bolster ties between the two countries. Among the key deals is an agreement to work towards economic and humanitarian cooperation. It was signed by Prime Minister Lee Hsien Loong and Uzbekistan... [Read more]

Sinda's new CEO to focus on education
A NEW chief executive has been named to lead Indian self-help group Sinda and help it 'to further sharpen its focus on education'. He is Mr Manogaran Suppiah, 47, an educationist who brings 26 years of expertise to the job, said... [Read more]

Rumbles in outer space
IT TOOK almost two weeks for China to admit that it fired a missile which destroyed an orbiting satellite. And when the admission finally came, Chinese Foreign Ministry spokesman Liu Jianchao did his best to minimise its importance.Beijing, he promised, had... [Read more]

Restructuring deadline for Shin Corp poses dilemmas
A LOOMING deadline for Shin Corp to restructure its shareholding organisation is set to pose separate dilemmas for Thailand's military-installed government and a Temasek Holdings-led consortium that controls the conglomerate.Here's why.Shin Corp, the publicly listed telecommunications group previously controlled by the... [Read more]

Tokyo seeks end to gas dispute

TOKYO - JAPAN has proposed to China joint development of disputed undersea gas fields in a bid to resolve a key source of bilateral friction, a Japanese newspaper said yesterday.

The two countries have been contending for control over areas in the East China Sea that may hold up to 200 billion cu m of natural gas.

According to a Nikkei daily report yesterday, Japan recently proposed to China that they jointly develop gas fields in a wider area surrounding the median line of the two countries in the East China Sea.

Japan considers the sea border to be halfway between each country's shores; China says its territory extends to the end of the continental shelf. China began test-drilling in the area in 2003. Japan has accused China of starting production and siphoning off gas on Tokyo's side.

Japan earlier sought to limit the joint development area to the four gas fields that are being developed by China, while Beijing has suggested areas that Tokyo considers to be on its side of the maritime border.

In the new proposal, Tokyo would foot the bill for the drilling facility that China has set up, said Nikkei, which did not specify its sources.

It said Japan's Vice-Foreign Minister Shotaro Yachi made the proposal during a visit to Beijing in January.

AGENCE FRANCE-PRESSE, BLOOMBERG

Temasek in bid to buy Stats for up to $2.85b

SINGAPORE investment firm Temasek Holdings has launched a bid, worth up to $2.85 billion, to take semiconductor associate Stats ChipPac private.

Temasek is offering to pay as much as $1.88 for every Stats share it does not own and will take on US$265 million (S$405 million) of Stats' outstanding borrowings if it is successful with the takeover.

The maximum offer price is at a 27 per cent premium over the counter's closing price of $1.48 on Wednesday, ahead of yesterday's offer announcement.

When the counter resumed trading yesterday, the share price shot up 33 cents to $1.81.

But analysts were not bowled over by the offer and said that the move could well be an effort to bump up gains from a future sale of the world's No. 4 chip testing and packaging company.

Temasek, which has a 35.6 per cent stake in Stats, is offering $1.75 cash for each share that it does not own. It will pay $1.88 if it ends up with at least 90 per cent of the chip company.

At that point, it would exercise its right to a compulsory acquisition of all remaining shares and delist Stats from Nasdaq and the Singapore Exchange.

According to offer documents presented by Temasek's financial adviser Goldman Sachs, the investment firm will also take over two tranches of Stats' convertible bonds due next year. The offer is conditional on Temasek getting at least 50 per cent of Stats.

Industry watchers said Stats shares could reach Temasek's offer price without the offer later this year, noting that its shares were sold at $3.56 apiece when they were first listed in 2000.

Then known as ST Assembly Test Services, the company has since become much larger after the US$1.6 billion acquisition of ChipPac three years ago.

'If you take a short-term view, the valuation is attractive, said Daiwa Institute of Research analyst Pranab Sarmah.

'But if you consider that Stats has turned around their business in 2006, becoming profitable after five years of losses, then maybe you might want to hold on to the shares to enjoy the growth in 2008.'

DBS Vickers analyst Don See said Temasek picked a good time to buy the shares as the industry is bottoming out and is poised for a recovery later this year.

Analysts were surprised at the offer as Temasek has indicated that it is trying to grow its investments outside of Singapore.

Also, Stats is generally not seen as strategic to Singapore's economy - seemingly the only non profit-maximising reason for Temasek to hold on to an investment. Some analysts thought the bid could be a way to attract higher offers for the firm.

Others suggested that Temasek could be trying to form a bigger company by merging Stats with another chip company that it will buy. This will allow Temasek to reap greater gains when it sells the enlarged entity.

The theory may have found some acceptance, as shares of United Test and Assembly Center and Chartered Semiconductor Manufacturing saw strong gains yesterday amid a general selldown in the local stock market.

Explaining its interest to raise its shareholding in Stats, Temasek said it has been a long- term shareholder and continues to believe in its prospects.

Stats said in a separate statement that it will be appointing an independent financial adviser to make recommendations on the offer.

bryanlee@sph.com.sg

UOB chalks up industry record of $2.57b gain

UNITED Overseas Bank (UOB) ended the earnings season of the three local banks on a spectacular note, with a 50 per cent surge in full-year profit to $2.57 billion - an industry record.

The results, which beat market expectations, were achieved 'despite the intense (regional) competition', said UOB deputy chairman and president Wee Ee Cheong.

Breaking with tradition, he chaired the results briefing instead of his father Wee Cho Yaw, UOB's chief executive and chairman, who is 78 this year but has not made public any retirement plans.

Hefty one-time gains were a key factor that catapulted the three banks' combined profits up a dazzling 78.6 per cent to a record $6.84 billion, from $3.83 billion in 2005.

UOB recorded a one-time gain of $689 million from a special dividend received from Overseas Union Enterprise (OUE) and the divestment gains of OUE and Hotel Negara in the second quarter of last year.

OCBC Bank's divestment gains of $559 million propelled it past the $2 billion mark, while DBS Bank recorded gains of $94 million from the sale of buildings, which helped to lift its net profit to $2.27 billion.

Excluding one-time gains, UOB's bottom line would have risen 10 per cent to $1.88 billion. Its fourth-quarter net profit rose 24 per cent to $537 million. Earnings per share rose 54 cents to $1.65. Net asset value per share rose 14.3 per cent to $10.48.

With the stars well aligned last year - a robust economy, recovering loans growth and exuberant stock markets lifting fee income - the banks would have been 'remiss to turn in anything less than record profits and dividends', said an analyst.

UOB's eye-catching net profits, which trumped the $2.44 billion average forecast by analysts in a Reuters poll, reflected its strong broad-based growth, said some analysts. Others felt DBS had the 'most solid operational performance', with record high interest and fee income.

UOB proposed the most handsome dividends, with a final dividend of 50 cents and a special dividend of 10 cents. This takes the total dividend for the year to $1.

But the free fall in stock markets yesterday battered the stock, which closed 60 cents lower at $20.40. Still, it narrowed the gap with DBS' share price which plummeted $1.20 to close at $21.30.

The younger Mr Wee also hinted at the prospect of bumper payouts in the future as the bank plans to 'continue with a high dividend policy' and is mulling over ways to manage excess capital such as share buy-backs and hold more Tier 2 capital, which is cheaper than Tier 1.

UOB's total capital adequacy ratio - amount of capital banks must set aside against their credit exposure - is the highest of the three banks at 16.3 per cent, while its Tier 1 is currently at 11 per cent.

Its net interest income rose 15.5 per cent to $2.71 million last year.

It grew gross customer loans by 13.7 per cent to $79.4 billion last year, thanks to its focus on the two hot segments - small and medium-sized enterprises and higher-end private homes, said one analyst. OCBC posted a 7 per cent rise in loans, while DBS had 10 per cent.

The three banks may post stronger interest income growth this year, riding on sustained loans growth momentum across the region. Macquarie Securities analyst Tay Chin Seng expects 'a more meaningful recovery in the property market in the second half of 2007' to boost loans.

DBS' net interest margins of 2.2 per cent far outstripped those of its rivals, riding on its regional corporate loans book. UOB's margins were flat year-on-year at 1.99 per cent and OCBC's was at 2 per cent.

Mr Wee said UOB's investments in building up its non-interest income business and its regional push are paying off.

Non-interest income rose 7 per cent to $1.5 billion excluding gains, thanks to strong fee and commission income, which crossed the $1 billion mark. Meanwhile, UOB's offshore profit contributions rose to 32.5 per cent, from 22.4 per cent.

Mr Wee said UOB has applied for approval for local incorporation in China. The other two banks have already gotten the green light to open retail banking branches there.

graceng@sph.com.sg

deepa@sph.com.sg

Isetan to pay out $1.50 a share to use tax credits

RETAILER Isetan (Singapore) yesterday showed that it was not deaf to minority shareholders' plea by announcing that it will pay dividends of $1.50 per share to use up some of its tax credits.

The payout is less than the around $7 a share Isetan's Section 44 tax credits of under $60 million can translate to, but may go some way to break the 'dividend deadlock' with disgruntled minority shareholders.

These investors have been clamouring for Isetan to use up its tax credits by paying dividends before they expire at the end of this year.

About 200 minority shareholders tried, but failed, to oust the retailer's independent shareholders last year.

Their drastic action prompted Isetan to look into the matter, together with controlling shareholder Isetan Japan.

Yesterday, the retailer said it had initiated but abandoned plans for a rights issue exercise as its parent is, 'for its own reasons, not able to support a proposed rights issue exercise'.

Instead it will pay the $1.50 cash dividend as a final and special dividend for the year ended Dec 31.

'The company has always maintained that the board is supportive of an effort to return to shareholders its available Section 44 tax credits as far as it is able, given business and financial constraints,' it added.

The Singapore-listed company has been in active discussions with professionals, it said. Isetan Japan has also been in consultation with its own advisers in Tokyo over the proposed rights issue.

Isetan Singapore has even written to the Inland Revenue Authority of Singapore, obtaining a favourable ruling on the tax treatment of a proposed dividend payment and rights issue. Under this proposal, shareholders would have been paid a cash dividend, with the option of using this to subscribe for the rights.

However, despite its 'strenuous efforts and serious discussions' with its parent, it was recently informed of Isetan Japan's decision not to support the rights issue.

Section 44 tax credits allow investors whose tax rate is lower than the corporate rate to get a refund on the tax they incurred on dividends. Companies were given until the end of this year to make use of the tax credits they chalked up under the old tax system, after the new one-tier system came into effect at the start of 2003.

Isetan also announced a 48.3 per cent jump in net profits for the year ended Dec 31, to $14.4 million yesterday.

Sales rose 7.6 per cent to $309.2 million. Earnings per share rose from 23.5 cents to 34.8 cents. Net asset value rose from $4.71 to $4.87.

Isetan shares yesterday closed unchanged at $6.

News Today

Change Agent
NEW DELHI - BACK from Paris after presenting a climate change report, Dr Rajendra Pachauri was disturbed by a mosquito's buzz as he rested in his New Delhi home last week. What alarmed the environmental expert, who chaired the United Nations-backed... [Read more]

Sub-tenants told of big mall opening. What they got: empty stalls and legal woes
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Post-secondary fund a good move but more please, say parents
THANK you, it is a nice gesture but it is not enough. While Singaporeans appreciated the money the Government would be giving them for post-secondary education, they said the amount was too little and conditions on its use too restrictive. Second... [Read more]

$45,000-per-head dinner extravaganza in Bangkok
BANGKOK - SUPERLATIVES are flying about in Bangkok over a 1-million- baht-per-head (S$45,000) gala dinner tonight prepared by six of the world's finest chefs. The first of 15 people wealthy enough to afford the price - plus the 17 per cent... [Read more]

Undersea quake hits Indonesia's Maluku islands
JAKARTA - A STRONG 6.6-magnitude undersea earthquake rocked Indonesia's northern Maluku province yesterday, the meteorology agency said, prompting initial fears of a tsunami.The agency urged residents on Bacan island to be alert for signs of rising sea levels after the quake... [Read more]

Waiting for the mating call
It's feeding time for Rosa in the rhino sanctuary at Way Kambas National Park on the Indonesian island of Sumatra. But soon, it may be breeding time for the young rhino, which is one of two female rhinos that are expected... [Read more]

'1 language per speech' rule lifted for current term
PARLIAMENT will ring to the chorus of voices from the four official languages for the next five years.Deputy Leader of the House Mah Bow Tan yesterday suggested that Members be allowed to use multiple languages in their speeches for the duration... [Read more]

Arsenal watching goalkeeper Carson
LONDON - Liverpool's Scott Carson has emerged as a top target for Arsene Wenger, amid continuing uncertainty over Jens Lehmann's Arsenal future. The Gunners manager has admitted his concerns that Lehmann, 37, may be nearing the end of his career with... [Read more]

Govt quizzes Genting over its tie-up with Stanley Ho
GENTING International, which is building its $5.2 billion Resorts World at Sentosa, has been quizzed by the Government over its latest partnership with Macau's casino mogul Stanley Ho.According to reliable sources, news that the Malaysian operator was in talks with the... [Read more]

Osasuna hope to upset Barca again
MADRID - LEAGUE leaders Barcelona will be looking to bounce back at Osasuna tomorrow, following their shock 0-1 home defeat by Real Zaragoza in the Spanish Cup in midweek. The defeat was Barcelona's first in their Nou Camp Stadium this season... [Read more]

Putin offers Saudis help with atomic energy
RIYADH - PRESIDENT Vladimir Putin of Russia has offered to help Saudi Arabia develop atomic energy and pledged to develop ties with the Islamic world during his first visit to Saudi Arabia, a key US ally. Mr Putin yesterday listed the... [Read more]

News Today

FairPrice to absorb GST hike for 6 months
SHOPPERS with rice and about 400 other essential items in their baskets at NTUC FairPrice supermarkets will not feel the pinch when the Goods and Services Tax (GST) is raised on July 1. This is because, for six months from that... [Read more]

Witness hits back as defence targets his testimony
DEFENCE lawyers for the three former board members of the National Kidney Foundation took turns yesterday to pick apart the testimony of the new NKF board's witness, Mr Bobby Nair. But Mr Nair, the former senior deputy director of communications, held... [Read more]

Hotel worries may hit arrivals
RISING hotel rates and a short supply of rooms could keep some foreign tour groups away from Singapore, tour operators here for a travel trade show have warned. Visiting industry officials from the United States, Middle East and even neighbouring Indonesia,... [Read more]

$50m overhaul of Changi's runways
CHANGI Airport's 'project runway' has started, with work going on round the clock and clockwork scheduling needed to keep the planes flying. When Terminal 3 opens next year, the airport's two runways will be ready for 'heavier' traffic - in the... [Read more]

CapitaLand earns $40m from sale of office space
CAPITALAND has sold all its entire interest in the Samsung Hub office block to two different buyers for a gain of $40 million.The entire divestment of space in the central business district building amounted to $152.9 million.Property company Ho Bee Development... [Read more]

More market volatility likely ahead of Fed meeting
VOLATILITY'S the buzzword this week as money managers and investors alike try to make sense of the huge array of economic data and corporate earnings due out in the next few trading sessions.While stocks, led by banking and property issues, generally... [Read more]

Brokers' Choice
CREDIT SUISSE LESS BULLISH ON STAR CRUISES CREDIT Suisse is downgrading Star Cruises to neutral from outperform as the stock price has nearly tripled since the firm's win in Singapore. 'Even though we are raising our target price to 50 US... [Read more]

TV times
GOLF: FBR Open: Day 1 (Live, Ch22, tomorrow, 4am).HANDBALL: Men's World C'ship: S-finals (Live, Ch22, tomorrow, 2.30am).EventHOCKEY: SHF League, U-18 Girls: dMaster-ACJC v STC (6pm). Boys: Khalsa A v dMaster-ACJC (7.30pm) - Delta Stadium.... [Read more]

Try to learn more about other faiths
I APPLAUD Ms Aishah Mohamed's letter ('Don't call non-Muslims infidel or kafir'; ST, Feb 13), for her efforts to clarify certain terms used by some faiths on others.It is essential for people like us, who live in a multi-racial, multi-religious society,... [Read more]

One size no longer fits all with budget carriers
VIVA Macau, a month-old carrier in the Chinese gaming city, calls itself a 'fusion airline', claiming it offers the best of two worlds - the attractive fares of low-cost carriers and the high level of comfort of full-service airlines. Australia's Virgin... [Read more]

Charge Thaksin's wife with tax evasion: Committee
BANGKOK - A PANEL appointed to investigate corruption linked to deposed Thai prime minister Thaksin Shinawatra has recommended that criminal tax evasion charges be filed against his wife, her secretary and her brother, its chairman said yesterday. Khunying Pojaman Shinawatra and... [Read more]

Champions League

Wednesday

Barcelona 1

Liverpool 2

Porto 1

Chelsea 1

Inter Milan 2

Valencia 2

Roma 0

Lyon 0

Becks to promote U.S. 2018 bid?

ENGLAND'S Football Association suffered a potentially damaging blow, when it learnt that David Beckham may be used to promote a rival bid by the United States to host the 2018 World Cup Finals.

The United States Soccer Foundation president, Sunil Gulati, confirmed his intention to market the US as an alternative for the 2014 tournament, should a South American country not come forward.

Their real target is reportedly the 2018 edition.

The US' Major League Soccer grabbed the media spotlight last month, when Beckham signed a five-year US$250 million (S$384 million) deal to join the Los Angeles Galaxy.

The FA is expected to announce it is entering the race later this year, with the £800 million (S$2.4 billion) Wembley Stadium key to its hopes of success.

The 1994 Finals hosted by the US was regarded as a big success by Fifa. With China also potential bidders, the FA could face stiff competition.

AGENCE FRANCE-PRESSE

Zenden knows Barca pressure

BOUDEWIJN Zenden believes the pressure is all on Barcelona, when Liverpool step out at the Nou Camp for the first leg of their Champions League tie today.

Having spent three years at Barcelona, the Dutchman knows the unique demands of playing for the Catalan giants, reported the Liverpool Daily Post.

He is one of three current Liverpool players to have plied their trade at Barcelona. The other two are goalkeeper Jose Reina and midfielder Luis Garcia.

Barcelona will be given fervent backing today by the majority of the expected 98,000 capacity crowd.

'I was at Barcelona for three years, and it's a club where the only thing that counts is a result. And a result to them is always a win,' said Zenden.

'Sometimes even that is not enough, because you need to play good football as well.'

Barcelona defender Lilian Thuram has also stressed the importance of Barcelona winning, reported Soccernet.

He believes the Catalan club need a good lead to take into the second leg, because of Liverpool's impressive home record.

He said: 'They are a strong team, and we have to return to their stadium, where it is very difficult to win.'

Thuram is fighting to be fit for today's game. He stayed behind after the regular training session on Monday for an extra workout.

Taiwan bank in talks with DBS, seeks top partner

TAIPEI - FAR Eastern International Bank, a Taiwanese lender, said it seeks a strategic alliance with a world-class financial company.

It added that it has been in talks with Singapore's DBS Group Holdings.

While discussions with DBS have been taking place for the past two to three years, 'no conclusion has been reached', the Taipei-based company said in a statement to the Taiwan Stock Exchange yesterday.

Far Eastern is the banking arm of Far Eastern Group, which controls the island's largest textile company and has units in shipping, mobile-phone services and retailing.

Far Eastern did not define 'strategic alliance' or say if it seeks partnerships only with overseas banks. Neither did it provide more details on its talks with DBS.

The government encourages mergers and acquisitions (M&As) in the financial sector to reduce the number of banks on the island.

Far Eastern said last June that it was in initial talks with potential buyers, and in October said it may sell a majority stake for the right price.

The bank's shares surged by the daily limit on Jan 25 after a news report said it may sell a 51 per cent stake to ABN Amro, which Far Eastern denied.

The Chinese-language Economic Daily News reported last November that Far Eastern might sell a 60 per cent stake to HSBC within a year in three phases.

This came after Far Eastern chairman Douglas Hsu said the month before that the lender could be willing to sell a majority stake for the right price.

The Taiwanese market has been speculating since last year that the local lender would form a strategic alliance with foreign investors, or sell a stake to the latter.

The company's statement yesterday came after the Chinese-language Commercial Times reported that DBS may buy a stake in the Taiwanese lender after completing due diligence on Far Eastern Bank.

'It's our policy not to comment on market speculation or M&A activity,' DBS spokesman Jenny Lee said in a phone interview.

Far Eastern, one of 16 lenders established in the early 1990s after the government liberalised the banking industry, is Taiwan's 18th-largest listed financial company by market value.

It has 35 branches on the island, according to its website.

BLOOMBERG NEWS

Tonight's News Summary

Almost all quake-hit cables fixed
BEIJING - CHINA'Sbiggest telecommunications companies have restored nearly all phone and Internet capacity that was affected by last month's earthquake near Taiwan, state media reported yesterday.China Telecom and China Netcom said major cables handling fibre-optic traffic, mostly between China and North... [Read more]

Companies in brief
SGX IN TIE-UP WITH ABU DHABI EXCHANGESINGAPORE Exchange (SGX) has tied up with its counterpart in Abu Dhabi to explore cross-border trading and clearing.The SGX announced yesterday that it signed an agreement with Abu Dhabi Securities Market that will pave the... [Read more]

CitySpring listing to raise up to $315m
CITYSPRING Infrastructure Trust, Singapore's biggest initial public offering (IPO) so far this year, could raise up to $315 million. The Temasek-backed entity launched its IPO yesterday with a projected tax-free distribution yield of between 6.7 per cent and 7.7 per cent,... [Read more]

BY DAY: A private school; BY NIGHT: Supplier of vice girls
BY DAY, it appeared to be a private school. At night, it was supplying women for vice-related activities. This was how private school group Ritz Everton Academy was believed to have been operating, until it shut down suddenly in the middle... [Read more]

$50m overhaul of Changi's runways
CHANGI Airport's 'project runway' has started, with work going on round the clock and clockwork scheduling needed to keep the planes flying. When Terminal 3 opens next year, the airport's two runways will be ready for 'heavier' traffic - in the... [Read more]

'Bubble forming' in China's stock market
DUBAI - CHINA'S stock market is developing into a 'bubble', and investors are in danger of behaving irrationally, a leading Chinese legislator has said.In the strongest public expression of concern to come from a senior state figure, Mr Cheng Siwei told... [Read more]

New Taiwan charter 'at odds with US policy'
WASHINGTON - THE incoming No.2 US diplomat, Mr John Negroponte, said a proposed new Constitution for Taiwan would likely be at 'cross purposes' with Washington's policy. When asked at a Senate hearing about his opinion on Taiwanese President Chen Shui-bian's push... [Read more]

Beijing slams Taipei over changes to textbooks
BEIJING - CHINA lashed out at Taiwan yesterday for dropping phrases from high-school history textbooks that link the two as one country, and said the move was another step towards promoting the island's independence.The changes included replacing terms such as 'the... [Read more]

Lee Teng-hui denies he sought formal split from China
IN TAIPEI - FORMER Taiwanese president Lee Teng-hui has caused a stir by saying he had never advocated formal independence for the island. Mr Lee, dubbed the 'godfather of Taiwan independence', said in an interview with Taiwan's Next Magazine published yesterday... [Read more]

Parliament Shorts
INCOME CEILING: HDB TO BE FLEXIBLE INCOME ceilings are still needed for purchases of subsidised Housing Board flats, but HDB will be flexible if families are in difficulty, said Minister of State (National Development) Grace Fu yesterday.Income ceilings help ensure that... [Read more]

3 homes burgled in one night
THREE homes on the same street in Pasir Ris were burgled on a single night while the occupants were all asleep, and over $14,000 worth of valuables were stolen. All three homes, just a few doors from one another in Pasir... [Read more]