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Hodgetts wins Paralympic gold

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LAUNCESTON shot putter Todd Hodgetts has won gold at the London Paralympics.
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The Newstead Harriers club member coached by John Minns beat the world champion Jeffery Ige of Sweden and set two world records on the way to claim his 16.29 metre win inthe shot put (F20) class.

“This is a dream come true, I am honoured to represent my country and to also win gold is a dream come true, it’s the greatest day of my life,” Hodgetts said.

After winning the medal, the 24-year-old formernational weightlifting championgrabbed the Australian Flag and did a lap of honour.

“It was a moment I will never forget, the crowd was electric and I loved every moment of it.”

Malaysia’s Muhammad Ziyad Zolkefli won bronze with 15.21 metres and fellow Australian Lindsay Sutton of Queensland finishing sixth.

Hodgetts thanked his coach Minns.

”John is the best coach in the world for sure, I cannot thank him enough for what he has done for me since I relocated to Canberra, and this paralympic gold medal I share with him for sure.”

Hodgetts has already announced he will defend his Olympic medal in Rio 2016.

More to come.

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Vote and recycle: the new way to run the paper gauntlet

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The streets around Tamworth schools and polling venues are full this morning as people get in early to cast their vote in today’s local government elections.
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At Tamworth Public School, prospective voters brought a little of their Saturday morning routine along, mothers pushing prams, elderly gentlemen with a paper tucked under their armand some with a takeaway coffee in hand.

Before actually casting your vote, it’s hard to avoid runningthe “paper gauntlet,” the long line of volunteers a regulation 6 metres from the entry gatewith their candidate paper in hand, whose job it is to influence your vote.

With 17 candidates in the Tamworth electorate, that’s a lot of paper if you don’t have the heart to say no to a friendly volunteer.

This year, with carbon footprints and recycling high on everyone’s agenda, waste-conscious voters are passing back the paper for volunteers to re-use.

“Yes we do get a few back these days,” said volunteer Steve Warden, dispensing papers for Tamworth candidate Judith Edmunds.

He said savvy voters were choosing to avoid the line and volunteers with their reams of paper by a gentle ‘no’ and straight through the gates this year.

His tip to avoid the paper chase?

“Pick your line straight from the car and make a beeline,” Mr Warden said.

At Tamworth Public School a prospective voter is spoiled for choice as candidate volunteers bombard him with choice. Photo: Kitty Hill

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Wagga polling booth locations

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Booths will be open at these locations from 8am – 6pm today
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Ashmont Public School

Collingullie Public School

Currawarna Community Centre

Forest Hill Public School

Glenfield Park Scout Hall

Humula Public School

Joyes Hall – Charles Sturt University

Kooringal Public School

Ladysmith Public School

Lake Albert Public School

Lutheran Primary School Wagga Wagga

Mangoplah Community Hall

Mount Austin Public School

North Wagga Public School

Our Lady Of Blessed Eucharist Church Hall

South Wagga Public School

Sturt Public School

Tarcutta Memorial Hall

Tolland Public School

Turvey Park Public School

Uranquinty Public School

Wagga Wagga Wesley Church Hall

Wagga Wagga Women’s Bowling Club

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Greece warned on spending as EU auditors arrive

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EU President Herman Van Rompuy warned Greece on Friday that it needs to produce results as bailout auditors arrived on a mission that will determine whether Athens gets extra time to make spending cuts in return for badly needed loans.
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Amid growing exasperation from Greeks about having to accept cuts upon cuts as they struggle through a fifth year of recession, Van Rompuy warned that Greece must deliver on promised fiscal and reform results to obtain further support.

If ‘‘Greece stays fully committed to these objectives and delivers results, European institutions and even every state will remain committed’’ to helping Greece, he said.

A favourable assessment from the auditors from the so-called troika of creditors — the IMF, EU and European Central Bank — is necessary for the release of a 31.5 billion euro ($A38.96 billion) loan installment.

They review Greece’s efforts to cut its deficit and adopt reforms needed to help improve its economic competitiveness as agreed as part of its 130 billion euro bailout package.

The troika has been demanding Athens make up for lost time after delays brought on by back-to-back elections that caused a two-month political deadlock.

But Greece has been pleading for ‘‘breathing space’’ to carry out the billions of euros in agreed cuts, arguing that reducing spending too much too fast will only further depress the economy.

A deeper than expected recession has made it even harder to meet the agreed targets.

‘‘The resistance of Greeks has reached its limit, which means we need a recovery as soon as possible,’’ Prime Minister Antonis Samaras said after meeting Van Rompuy.

Samaras said he stressed to Van Rompuy ‘‘the need to unlock in time the next installment’’ of bailout loans, with Greece expected to default within months if it doesn’t get the money.

Van Rompuy noted that Greek people were being asked to make difficult sacrifices and praised their ‘‘courageous choices in favour of the euro and their place in the euro’’.

‘‘Prime Minister Samaras has confirmed to me that his government, that his coalition behind it, are firmly committed to press ahead to this consolidation and important reform.’’

However, amid the cascade of bleak data, the coalition government has not finalised the program of cuts necessary to receive the next instalment of bailout loans.

Finance Minister Yannis Stournaras would likely meet the chief troika auditors on Sunday afternoon, a source in his ministry said, and present what the government has so far prepared for 11.5 billion euros in savings in 2013 and 2014.

Samaras is to meet the leaders of the parties in his coalition government that night, followed by a meeting with the troika on Monday morning.

Demonstrators were expected to heap further pressure on the government on Saturday, with the two main unions calling a protest in Greece’s second biggest city Thessaloniki against further cuts.

The measures reportedly include a 3.5 billion euro slash to pensions, health cuts worth 1.47 billion euros and a 517 million euro reduction to defence.

Key state staff paid under so-called ’special salary schemes’ — a group that includes police, firemen, clerics, diplomats, judges and the military — are also facing an average pay cut of 12 per cent, according to reports.

Samaras has promised that this will be the last round of cuts but Greeks on all sides are expressing outrage at any further austerity, and there have been signs of strains in Samaras’ ruling coalition.

‘‘It is certain that the measures being prepared will test the social cohesion and stability of the coalition government … but they are absolutely necessary in order to obtain financing for Greece from international lenders,’’ said Platon Monokroussos, chief economist of Eurobank.

Hospital doctors and judges took to the streets this week, and security forces also demonstrated on Thursday night against reported salary cuts.

AFP

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Portugal toughens austerity in bid to cut debt

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Bailed-out Portugal is adding more austerity to family budgets as it struggles to cut its debt amid a recession.
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Prime Minister Pedro Passos Coelho announced on Friday an increase in workers’ social security contributions to 18 per cent of their monthly salary from 11 per cent.

But he also said he is cutting companies’ welfare contributions to 18 per cent from 23.75 per cent to encourage hiring.

The government predicts an economic contraction of 3.3 per cent this year. Treasury figures indicate tax receipts will be 2 billion euro ($A2.44 billion) lower than forecast, while a record jobless rate of 15.7 per cent is draining state funds.

Portugal received a 78 billion euro rescue last year. It is aiming for a budget deficit of 4.5 per cent this year, but many analysts expect it will be more than 5 per cent.

AP

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Weak US jobs report deals blow to Obama

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The unexpected slowdown in August job growth dealt a blow to President Barack Obama’s hopes of gaining momentum coming out of his party convention and gave Republican candidate Mitt Romney another campaign weapon.
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Today’s Labor Department report drove the political debate as both candidates stop in Iowa and New Hampshire, two swing states. The labor data showed the economy added 96,000 jobs in August, down from a revised gain of 141,000 in July. While the unemployment rate fell to 8.1 per cent from 8.3 per cent in July, that resulted from more people dropping out of the work force.

The figures were released at a pivot point in the 2012 presidential campaign, with both party conventions finished and the two candidates embarking on a final drive to persuade voters before the November 6 election.

“The timing couldn’t be worse for the president in terms of coming out of a really good convention with some momentum,” said Stu Rothenberg, editor of the nonpartisan Rothenberg Political Report in Washington. “This just steps on that bounce and I think it’s a big problem for the Democrats.”

Arriving in Iowa today for a midday campaign rally in Orange City, Romney said the figures highlight the “clear choice” voters have in the presidential election.

Candidates’ views

“There’s almost nothing the president has done in the last three and a half, four years that gives the American people confidence he knows what he’s doing when it comes to jobs and the economy,” Romney told reporters in Sioux City, where his campaign plane landed.

Obama made only a passing mention of the jobs figures at his first post-convention campaign event today in Portsmouth, New Hampshire.

“We know it’s not good enough,” Obama said of the payrolls figure. “We need to create more jobs, faster.”

The rest of his speech followed the outlines of his address accepting the Democratic Party’s nomination for a second term last night in Charlotte, North Carolina.

He repackaged familiar administration policies, set a goal of creating 1 million new manufacturing jobs by 2016, and attacked Romney and the Republicans for offering “same prescriptions that they’ve had for the past 30 years.”

Central issues

Jobs and the economy are the core issues in the race, and they remain a burden for Obama. The unemployment rate has exceeded 8 per cent since February 2009, the longest stretch in monthly records going back to 1948, and economic growth this year is below normal for the post-World War II era. The August report showed 368,000 Americans left the labor force.

While the unemployment rate came down, “it fell for the wrong reason,” Maury N. Harris, chief economist for UBS Securities LLC, said today in a client note.

“I was, candidly, startled by how much the labor force declined,” said Matt McDonald, a partner at Hamilton Place Strategies in Washington who is advising the Romney campaign.

While the unemployment rate is typically the most closely watched by voters, that may be overshadowed by the lackluster growth in jobs, according to Rothenberg.

“The numbers do provide a mixed message with the unemployment rate down and the new jobs numbers very mediocre, rather disappointing, but the bottom line is a net negative certainly for the president and the White House,” Rothenberg said. “I don’t think you can come to any other conclusion other than the economy continues to be disappointing.”

Markets rise

The jobs report comes after a day of positive economic news for Obama and a week before the Federal Reserve Board may consider additional measures to boost the economy during its September 12-13 meeting.

Hours before Obama spoke last night, US benchmark stock indexes rallied to their highest levels in more than four years, highlighting an economic recovery that has propelled corporate profits above pre-recession records. Stocks ended the day mixed.

Romney said he did not believe that additional steps by the Federal Reserve would have much impact, calling the second round of monetary easing “less effective than we had hoped,” and suggesting that Obama is relying on the central bank to spur an economic recovery his policies have failed to create.

Obama lead

A Gallup daily tracking poll taken this week indicated Obama may have gotten a boost from the Democrat convention. Polling from Aug. 31 through yesterday showed him leading Romney among registered voters 48 per cent to 45 per cent. While still within the margin of error of plus or minus 3 per centage points, the gap was the widest since mid-July.

Obama’s approval rating was at 52 per cent, a 15-month high, in the tracking poll over three days ending yesterday.

Both surveys were completed before the jobs figures were released.

White House adviser David Plouffe told reporters traveling with Obama after the Labor Department report that the convention gave a boost to the president.

“That doesn’t mean the race is going to change significantly,” Plouffe said. “But we think that we come out of here with some momentum in terms of putting together the electoral picture.”

Swing states

Both candidates were making a play for swing states today, with Obama in New Hampshire and Romney in Iowa. The two will switch spots with Obama traveling to Iowa and Romney in New Hampshire. The two states combined have 10 of the 270 Electoral College votes needed to win the presidency and the attention being paid by the campaigns indicates how close they expect the election will be.

The jobs report’s impact extends beyond the campaign. Ben Bernanke, chairman of the Federal Reserve Board, said in an Aug. 31 speech in Jackson Hole, Wyoming, that the stalled labor market is “a grave concern.”

Persistently high unemployment “will wreak structural damage on our economy that could last for many years,” he said.

The economy would have to add about 13.3 million jobs over the next three years, or 370,000 jobs each month, to cut unemployment to 6 per cent. To reach that goal, the economy would have to increase at a 4 per cent to 5 per cent annual growth rate, according to economist Peter Morici at the University of Maryland.

Economic growth

By contrast, the economy grew at a 1.7 per cent annual pace in the April-June quarter, slower than the 2 per cent rate in the January-March quarter and 4.1 per cent in the last three months of 2011.

It has taken the US three years to recover about half, or 4 million, of the 8.8 million jobs lost as a result of the 18- month recession that ended in June 2009.

Private forecasters expected that payrolls in August would increase 130,000 after a 141,000 gain in July, according to the median forecast of economists surveyed by Bloomberg before the department’s report. They expected the jobless rate would be unchanged at 8.3 per cent.

The Romney campaign today said it released 15 new television ads in eight swing states — Florida, Iowa, Colorado, Nevada, New Hampshire, North Carolina, Ohio and Virginia — to “show how we’re not better off under President Obama.” The campaign said the ads would show Romney’s plans for defense, excessive regulations, reducing the deficit, raising home values and increasing manufacturing.

Bloomberg News

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Oil extends advance on Fed hopes

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Oil advanced for a third day as US payrolls increased less than expected in August, raising speculation that the Federal Reserve will boost stimulus measures to spur economic growth.
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Prices gained 0.9 per cent after the Labor Department reported the economy added 96,000 workers last month, less than the 130,000 median estimate in a Bloomberg survey of economists. The Federal Open Market Committee will meet Sept. 12-13 to discuss monetary policy.

“More than anything I think attention is focused on the employment numbers this morning, which were really bad,” said Addison Armstrong, director of market research at Tradition Energy in Stamford, Connecticut. “They made it easier for the FOMC to make some moves for stimulus when they meet next week. We may see some volatile days before they make their announcement Thursday.”

Crude for October delivery rose 89 cents to $US96.42 a barrel on the New York Mercantile Exchange, the highest settlement in a week. Futures dropped 5 cents this week and are down 2.4 per cent this year. They have advanced 24 per cent from the year’s low of $US77.69 a barrel on June 28.

Brent oil for October settlement increased 76 cents, or 0.8 per cent, to end the session at $US114.25 a barrel on the London- based ICE Futures Europe exchange.

The lower-than-forecast employment growth will move the Fed closer to more quantitative easing, Pacific Investment Management Co.’s Bill Gross said. The Fed implemented two rounds of large-scale asset purchases totaling $US2.3 trillion from December 2008 to June 2011.

Policy makers will give “strong hints” or provide “positive action” at the FOMC meeting, Gross, who runs the world’s biggest bond fund, said in a radio interview on “Bloomberg Surveillance” with Tom Keene and Ken Prewitt.

Bernanke comments

Fed Chairman Ben S. Bernanke said on Aug. 31 that he wouldn’t rule out more stimulus to boost the economy. The European Central Bank agreed yesterday to an unlimited bond- purchase program.

“The odds of more stimulus measures are going up after the jobs report,” said Phil Flynn, senior market analyst at the Price Futures Group in Chicago. “The Fed may join the ECB in more bond buying to try to stimulate the economy, and that’s kind of pushing oil higher.”

Last month’s payroll growth followed a revised 141,000 rise in July that was smaller than initially estimated, the Labor Department figures said.

“That’s about as bad as you can get,” said Michael Lynch, president of Strategic Energy & Economic Research in Winchester, Massachusetts. “But people are thinking that the stimulus measures will get stronger.”

Unemployment slips

The unemployment rate unexpectedly fell to 8.1 per cent in August as the share of the working-age population in the labor force slumped to the lowest level since 1981. The participation rate decreased to 63.5 per cent from 63.7 per cent.

Oil also advanced as the euro gained as much as 1.4 per cent against the US dollar on the Fed stimulus speculation. The currency rose to $US1.2806, the highest level since May. A stronger euro and weaker US dollar boost oil’s appeal as an investment alternative.

Crude fell as much as 1.5 per cent earlier on speculation that the White House is considering tapping the Strategic Petroleum Reserve.

A release may be more likely should Brent reach $US120 a barrel, said a person with direct knowledge of a meeting yesterday that Obama administration officials held with outside crude-market experts. The administration hasn’t made a decision on whether to release oil from the reserve, and there was no discussion of any deadline for a decision, the person said.

Release odds

“The odds of an SPR release are increasing,” said Stephen Schork, president of the Schork Group Inc. in Villanova, Pennsylvania. “The administration really has to do something to deflect what they are seeing now.”

The Obama administration is continuing to look at all its options to make sure high oil prices don’t crimp the global economy, Jay Carney, the White House press secretary, said Aug. 30 in response to a question at a briefing.

Electronic trading volume on the Nymex was 493,147 contracts as of 3:43 p.m. in New York. Volume totaled 710,388 contracts yesterday, 32 per cent above the three-month average and the highest level since Aug. 15. Open interest was 1.56 million.

Bloomberg

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Gold retains gains on Fed stimulus hopes

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Gold is holding steady after rallying to its highest in six and a half months in the previous session as a sharply disappointing US employment report fuelled expectations for imminent easing from the Federal Reserve.
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Spot gold was little changed at $US1734.64 an ounce, after rising to $US1741.30 the session before, its highest since Feb 29.

US gold edged down 0.2 per cent to $US1737.40, holding onto its 3-per cent gain from last week.

US jobs growth slowed sharply in August, setting the stage for the Fed to pump additional money into the sluggish economy at a meeting this week.

A Reuters poll of 59 economists gave a 60 per cent chance the Fed will announce another round of quantitative easing, or QE3, at the conclusion of its Sept. 12-13 gathering.

China’s factories ran at their slowest rate for 39 months in August, while a double-digit rise in fixed asset investment showed that infrastructure spending remained key to economic growth.

Holdings of gold-backed exchange-traded funds rose to a fresh record high of 72.125 million ounces on Friday.

Hong Kong shipped nearly 76 tonnes of gold to China in July, up 12 per cent on the month, while it received nearly 30 tonnes of gold from China, the Hong Kong Census and Statistics Department said.

Silver and platinum hovered near the multi-month highs hit on Friday. Spot silver inched down 0.2 per cent to $US33.60, near a six-month peak of $US33.71, and spot platinum gained 0.7 per cent to $US1,592, after breaking above $US1,600 for the first time in five months.

Reuters

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Europe stocks notch best week in six months on ECB plans

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European stocks climbed, completing their biggest weekly rally in three months, on speculation that the Federal Reserve will opt for further stimulus after a report showed US employers hired fewer workers than estimated.
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Banks contributed the most to the Stoxx Europe 600 Index’s advance as Deutsche Bank AG and Barclays Plc each climbed more than 5 per cent. Xstrata Plc jumped 3.6 per cent after Glencore International Plc increased its offer for the mining company led by Mick Davis. Solvay SA climbed 3.3 per cent after NYSE Euronext said it will join France’s CAC 40 Index.

The Stoxx 600 advanced 0.2 per cent to 272.3 at the close, after earlier rising as much as 0.8 per cent. The gauge has gained 2.3 per cent this week as European Central Bank President Mario Draghi said yesterday that policy makers agreed on a plan to buy unlimited government debt.

“The Fed’s not going to be happy with the payrolls numbers and will probably look for a way to stimulate the economy,” said Mike Lenhoff, chief strategist at Brewin Dolphin Securities Ltd. in London, in a phone interview. “It’s a win-win for the markets: if the numbers were good, it would’ve meant the economy is improving. Now the numbers are bad, the Fed might do something about it. Markets are also rallying because of the positive developments in Europe.”

In the US, a Labor Department report showed that employers hired 96,000 workers in August, down from a revised 141,000 in July. Economists had forecast that the world’s largest economy added 130,000 workers last month.

US unemployment

The release also showed that the nation’s unemployment rate unexpectedly slipped to 8.1 per cent. Economists had predicted a jobless rate of 8.3 per cent, according to the median projection in a Bloomberg News survey. Unemployment has stayed above 8 per cent for the last 43 months.

The Stoxx 600 posted its biggest weekly gain since the beginning of June after Draghi said yesterday that the ECB has approved his bond-buying plan. The central bank will target government securities with maturities of one to three years, Draghi said. Purchases will be fully sterilized to ensure a neutral impact on money supply, and the ECB will not have seniority, he said.

The volume of shares changing hands on the Stoxx 600 today was double the average of the last 30 days, according to data compiled by Bloomberg.

The VStoxx Index, which measures the cost of option prices on the Euro Stoxx 50 Index, dropped for a third day, declining 5.6 per cent to 21.83. The gauge tumbled 16 per cent yesterday, its largest slide since October last year.

China infrastructure

China has approved plans to build 2,018 kilometers of roads, according to statements on the National Development and Reform Commission’s website. The state endorsed the projects in the June-August period. A Sept. 5 statement showed the government also gave the go ahead for plans to build subways in 18 Chinese cities, as it seeks to revive economic growth.

National benchmark indexes climbed in every western- European market except Denmark today. The U.K.’s FTSE 100 added 0.3 per cent, while Germany’s DAX advanced 0.7 per cent. France’s CAC 40 rose 0.3 per cent.

A gauge of banking shares advanced 2.1 per cent to its highest level in five months. Deutsche Bank and Barclays surged 5.3 per cent to 31.36 euros and 6.9 per cent to 206.4 pence, respectively.

Banks rally

Santander SA, Spain’s biggest lender, climbed 1.7 per cent to 6.08 euros, while BNP Paribas SA, France’s largest bank, added 1.7 per cent to 37.78 euros. Credit Agricole SA and Societe Generale SA jumped 6.5 per cent to 5.34 euros and 6.8 per cent to 24.49 euros, respectively.

Italy’s Banca Monte dei Paschi di Siena SpA surged 11 per cent to 26.4 euro cents, while Portugal’s Banco Espirito Santo SA soared 8 per cent to 66.2 cents.

Xstrata gained 3.6 per cent to 1,014 pence, while Glencore slumped 3.6 per cent to 378.1 pence. The commodities trader, which owns 34 per cent of Xstrata, offered 3.05 of its shares for every one that its target’s investors hold, according to a statement from Zug, Switzerland-based Xstrata. Glencore’s Chief Executive Officer, Ivan Glasenberg, will become CEO of the combined group. Under the previous offer, Xstrata’s Davis would have taken on the position.

Rio Tinto Group climbed 6.2 per cent to 3,021 pence for the biggest contribution to the Stoxx 600’s advance.

Solvay gained 3.3 per cent to 91.79 euros after NYSE Euronext said late yesterday that the maker of chemicals and plastics will replace PSA Peugeot Citroen in the CAC 40 from Sept. 24.

Meggitt Plc added 1.6 per cent to 407.3 pence after Citigroup Inc. raised its recommendation on the shares to buy from neutral. The brokerage said that other companies may find Meggitt an attractive takeover target.

Neopost SA slumped 8 per cent to 38.99 euros, its biggest drop since October 2007. The company late yesterday posted second-quarter sales of 260.7 million euros ($333 million), a 2.2 per cent decline from a year earlier based on constant exchange rates.

Bloomberg

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A commitment to print, an eye on digital

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Staff at Australia’s largest magazine publisher, Australian Consolidated Press, were not the only ones sighing with relief this week when their private equity paymasters, CVC, announced the business will be sold to family publishers, Hamburg-based Bauer Media Group.
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”I think they’re very relieved that it is in the hands of someone who knows the business, and not somebody who is only intent on buying into the company to make money,” says Ita Buttrose, the legendary magazine publisher who will forever be associated with ACP.

”They’re regarded as a good company,” she says of Bauer, ”and they’re a family company, and in a way that’s not unlike the Packers when it [ACP] was at its heyday. It was very much a family company.”

The magazines division featured prominently in the popular ABC production Paper Giants, which focused on the launch of Cleo magazine by Buttrose as its editor, and publisher Kerry Packer.

The appeal of family control was not just a sentimental view from a former employee.

Steve Allen, the head of Essence Media & Fusion Strategy, also says ”it is fantastic to go back to family ownership because that’s a very good model that ACP thrived under”. His point is that ACP will now need to shed the cost-cutting mentality foisted on the company by CVC and rejuvenate its publishing culture at senior levels.

”CVC have been managing costs. [The] people that are in charge now are cost managers, they are not visionaries, they are not dyed-in-the-wool magazine people,” he says.

With a pedigree in magazine publishing extending back to the 19th century, the Bauer family’s credentials are not in question. But they represent a very different kettle of fish to the Packer family, who owned the business until James Packer sold out to CVC five years ago.

Bauer, a tightly family-controlled publishing house, made its name in Germany in the 1960s and 1970s with its stable of TV guides, mass-market women’s and gossip rags, and erotic men’s mags, but has struggled to break into the quality end of its home market.

With a reputation for unhappy working conditions in some of its publications, there was an old adage in the German media industry: ”People don’t go to Bauer, they come from Bauer.”

But a better test of what’s in store for venerable ACP titles like The Australian Women’s Weekly might be provided by Bauer’s track record with its overseas acquisitions. The company has built a global portfolio of quality titles, and revenues of more than €2 billion ($2.44 billion).

Bauer acquired a British consumer magazine business from EMAP in 2007, which included premium titles such as Zoo, FHM, and Grazia, around the same time that ACP acquired many of the same titles from EMAP in Australia.

On the cusp of the worst financial crisis since the great depression, there were already misgivings about what changes would be made to the British publisher, which had been highly successful with the launch of the above-mentioned titles over the preceding seven years.

Pioneering British men’s monthly Arena was closed in 2009 and jobs were cut in other divisions, but Bauer’s UK chief executive, Paul Keenan, said this was a result of the structural change and the economic climate that was forcing ”huge change” in the media industry.

Keenan had remained head of the British publications after Bauer acquired EMAP. In an interview with The Guardian last year – something which the deeply private Bauer family almost never indulge – said ”going into a private, long-term, cash-rich [group]” was ”a fantastic place to be”.

It may be telling that the former EMAP business has not produced a blockbuster publication since the takeover, although it has not been through lack of effort.

An attempt to re-enter the quality men’s market following the closure of Arena, with Gaz7etta, failed to gain traction last year.

And Keenan’s comment on the family? ”They’re just interested in us producing the best product we can.”

Keenan made reference to the ”Bauer personality” talking of obsessional attention to detail and being operationally excellent.

Bauer is ”quietly and confidently trying to produce world-class product day in and day out”, he says.

But private control also comes with the idiosyncrasies of the Bauer family who are very much in charge. This includes marathon boardroom grillings by the fifth generation of Bauers who run the publisher and remain largely unknown.

Heinz Bauer led the family business for more than four decades before handing over the reigns to his 35-year old daughter, Yvonne, two years ago.

Despite his privacy, Bauer ran the company long enough for stories to seep out about his notorious frugality.

This includes staff having to hide the true cost of his accommodation in New York while there on business trips to his US operations. They would arrange in advance with hotel management to change the room tariffs on the back of his door.

In a rare media interview in 2009, the notoriously media-shy media patriarch dismissed the publisher’s public image of a penny-pincher ”as a cliche to talk down our success”.

Then he confirmed that ”patronage is not my thing”. Publishers had to make products that would entertain and sell, rather than seek to improve the world. ”We don’t want to educate our readers, but distract them.” While publishing houses relied on the editorial input of journalists, it was hard to include journalists in management decisions as they ”don’t like to surrender to the constraints of economic logic”, he said.

Yvonne Bauer now controls the group with 85 per cent of the limited partnership which owns the business. The remainder is split among her three sisters, who also work in the business. At the traditional annual press conference in December 2010, her first in the publisher’s role, Ms Bauer reaffirmed the company’s clear commitment to the magazine medium despite its strong forays into digital and cross-platform business.

”Bauer is print and Bauer shall remain print,” she said at what is traditionally the family’s only communication with the outside world.

A prepared statement released with this week’s announcement of the ACP deal did offer more of a nod to the future.

”ACP fits our strategy of developing the Bauer Media Group globally, we believe in print, and ACP’s strong brands in Australian and New Zealand are strong platforms to extend into digital areas,” it said.

This is expected to be one of the challenges for Bauer once the transaction passes hurdles that include a review by the foreign investment review board and approval by Nine Entertainment’s creditors, who have waged a campaign to take control of the debt-laden media business.

”The biggest issue is how integrated Nine Entertainment is in all respects. Not just from content, from cross-platform selling [etc],” Allen says.

Bauer needs to extract ACP from Nine Entertainment without damaging the value derived from Nine’s cross-platform sales and promotion between its web, TV operations, and the magazines which will soon be owned by Bauer.

According to Allen, Bauer do not have any experience managing an integrated media empire like Nine Entertainment. As ”much as they have an appreciation for this, they’ve never done it as far as we can see”.

The details of the deal they work out over the coming months will be crucial to how successful the investment is, and at about $500 million, it is a major bet for the family company.

According to Fusion, Australia is set to represent Bauer’s second-largest territory by revenue once the deal is done.

And while the impact of the global downturn has been felt in Bauer’s markets globally, turning around the Australian operation – which is generating about one-third of the earnings it did before CVC’s takeover – will not be easy.

With the vast majority of Australian magazine sales bought over-the-counter, rather than through subscription, the market is especially sensitive to the consumer malaise and its impact on discretionary spending.

Theoretically it means that most of the reader sales lost in recent years should return when confidence returns to the hip pocket.

But that depends how much of the issue is structural – readers moving away to the internet – or cyclical, a temporary effect of the economic cycle.

It also depends on how much it represents the market share ACP may have lost while under the control of the bean-counters.

Fusion points out that Seven’s magazine business, Pacific Magazines, claims it has increased its market share over each of the past five years.

The impending sale of ACP to Bauer has extended a lifeline to its parent, Nine Entertainment, and owners CVC, who effectively paid James Packer about $5 billion for the business. Most of the payment was in the form of debt, which is strangling the media empire and necessitated the sale of ACP by reluctant Nine chief David Gyngell.

”The decision to sell the magazine business is not one we have made lightly,” he said in a prepared statement this week.

The deal will help Nine avoid breaching debt covenants which would leave it at the mercy of

its lenders.

The company still faces pressure from hedge funds Apollo and Oaktree, which have acquired $1 billion of Nine’s senior debt in an attempt to force CVC to relinquish control of the company if it cannot refinance Nine’s debt next year.

CVC must repay $2.8 billion of debt by February and a further $1 billion a year later, but a breach of its quarterly debt covenants could trigger immediate payment of all the debt, according to Nine’s financial accounts from last year.

”In those circumstances, the assets of the group may not be realised and liabilities may not be discharged in the normal course of business,” the accounts said.

This story Administrator ready to work first appeared on Nanjing Night Net.