Thursday, December 25, 2008

Daily news - 24 Dec

DBS takes another hit as analysts lower targets
DBS Group shares shed a further 33 cents or 3.5 per cent yesterday to close at $9.04, as plans for a $4 billion rights issue prompted several research houses to cut their target price for the stock. The slide happened even though Standard & Poor's maintained its stable outlook for the Singapore banking group after the news. The one-for-two rights issue, priced at a 45 per cent discount to the stock's $9.85 closing on Dec 19, would raise funds for the bank to strengthen its balance sheet and grow organically, said DBS on Monday. It also warned of lower fourth-quarter earnings.

SIA Cargo to defend against Aussie cartel claim
Singapore Airlines (SIA) Cargo plans to defend itself against allegations made by the Australian Competition and Consumer Commission (ACCC) that it is part of a price fixing cartel. 'SIA Cargo is committed to competing successfully and fairly, within the requirements of the relevant competition law in Australia,' SIA Cargo said in a statement yesterday, adding that it has worked co-operatively with competition authorities during the course of their investigations. SIA Cargo declined to comment in greater detail, saying that it would be inappropriate, given that the matter was now before the court. Australia's antitrust regulator is claiming that SIA Cargo had 'arrangements or understandings with other international air cargo carriers that had the purpose or effect of fixing the price of a fuel surcharge and a security surcharge' on cargo carried to and from Australia between 2001 and 2005. As such, it is seeking 'declarations, injunctive relief, pecuniary penalties, and costs'. Citing court documents, media reports out of Australia yesterday reported that Australian meat exporters sending their goods to the Middle East were slapped with higher charges as SIA Cargo allegedly attempted to capitalise on the growing number of US troops in Iraq. 'Apart from allegedly taking part in a global freight cartel, SIA Cargo is also accused of reaching separate deals in Hong Kong, Indonesia, the United Arab Emirates and Singapore,' Australia's International Business Times reported.

Source: Kim Eng

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