Headlines

Emmanuel Macron’s grand plan for a eurozone budget has been downsized. A key part of his successful campaign for the French presidency, the budget was envisaged as a fiscal bazooka worth several percentage points of eurozone GDP. But the plans have since been progressively whittled down by wary EU governments, the Financial Times reported. The tool’s eventual firepower could be capped to as little as €22bn spread over seven years.

The collapse of the UK savings company London Capital & Finance, swallowing most of the £236m entrusted to it by 11,500 people, is one of the most troubling investment scandals of recent years. The failure requires not only an inquiry into how so much cash could vanish, but regulatory reform to prevent savers being so easily deceived by the aggressive marketing of risky financial products, the Financial Times reported in a commentary.

Debenhams has cleared a hurdle in its attempt to push through a crucial restructuring plan, dealing a blow to a potential bid for the struggling retailer by Sports Direct chief executive Mike Ashley, the Financial Times reported. The department store chain said it had secured the support of a majority of its bondholders for a series of technical changes that help clear the way for a £200m refinancing. The approval puts Debenhams in a position to confirm the new funding in the coming days and move to pursue restructuring options to secure the future of the business.

During the 1990s, as their Essar group rolled out big investments in oil and steel, Shashi and Ravi Ruia exemplified a hard-charging generation of Indian businessmen riding a wave of liberalising reforms, the Financial Times reported in a commentary. In the next decade, the billionaire brothers became archetypes of a different sort. After a series of debt restructurings, they came to symbolise the impunity of Indian “promoters”, or controlling shareholders, who clung to control of their ailing businesses while persuading lenders to take heavy losses.

Wow Air Hf has gone out of business, stranding thousands of passengers and creating potentially huge risks for Iceland’s tiny economy and its growing reliance on tourism, Bloomberg News reported. The discount carrier is the eighth European airline to have failed since the summer as margins are pinched by fluctuating fuel costs and over-capacity that’s sparked a continent-wide fare war. Wow’s demise should bring short-term relief to local rival Icelandair Hf.

The Turkish lira resumed declines on Thursday even as the nation orchestrated a currency crunch to stem the currency’s losses days before an election that will test support for President Recep Tayyip Erdogan’s rule, Bloomberg News reported. Investors dumped bonds and stocks on Wednesday and the cost of borrowing liras overnight on the offshore swap market soared past 1,000 percent because local banks are under pressure not to provide liquidity to foreign fund managers who want to bet against the lira. A government official said the measures are temporary.

Mitie Group Plc is not on the verge of launching a takeover bid for the biggest division of rival Interserve, Chief Executive Officer Phil Bentley said on Thursday, while saying the company would be foolish to “not keep in touch,” Reuters reported. Sky News reported here earlier this month, giving no details of its sources, that Mitie was drawing up plans to offer Interserve's new owners about 100 million pounds ($131.14 million) for its support services unit.

Finance Minister Tito Mboweni urged the South African National Roads Agency SOC Ltd. to reverse a decision not to chase down people who aren’t paying electronic tolls to fund a freeway upgrade around Johannesburg and Pretoria. The state-owned company known as Sanral has faced resistance to e-tolls from motorists since their inception in 2013 and hasn’t issued public debt in at least three years following a drop in revenue caused by the boycott, Bloomberg News reported.

Bankers expect sales of high-yield bonds in Europe to remain depressed through the second quarter of 2019 owing to a sharp slowdown in M&A activity, as well as still relatively high funding costs that are deterring opportunistic issuers, Bloomberg News reported. Falling bond yields, a narrowing iTraxx Crossover Index and sustained fund inflows failed to boost new issuance volumes during the first quarter. Bond sales totaled 10.2 billion euros ($11.3 billion) in the first three months, down 45 percent on the same period of last year, according to data compiled by Bloomberg.

China’s HNA is selling down its prized airline holdings, a strategy reversal that underlines the scale of its struggle to pare its debt burden, the Financial Times reported. The sale on Wednesday of budget carrier HK Express to Hong Kong flag carrier Cathay Pacific comes as problems grow for the finance-to-aviation conglomerate, once among China’s most globally acquisitive companies. In the past two years HNA has sold more than $40bn in assets to trim a debt pile twice that size.