Headlines

Italy’s UniCredit is plotting to merge with French rival Société Générale in a bold move that would see two of Europe’s big banks join forces, leading the way for an expected round of banking mergers on the continent, the Financial Times reported. Jean-Pierre Mustier, Unicredit’s French chief executive, has been pioneering the idea for several months, according to people close to the situation. They said no formal approach has been made but SocGen directors have also been studying the possibility of a combination.

It is unfortunate that so many Europeans treat European integration as an act of faith. The Brexit debate pits Europhile true believers against sceptical atheists, which is why we are talking about the two equally absurd propositions: a second referendum and a hard Brexit. Italians treat the question of their euro membership in a similar way. You either belong to this camp, or that, the Financial Times reported in a commentary. If you are, like me, somewhere in the middle, people feel confused.

Venezuela's central bank in April paid $172 million (£128.8 million) to U.S. bank Citigroup to recover part of the gold it had put up as guarantee in a swap operation, according to two sources familiar with the situation, the International New York Times reported on a Reuters story. Sanctions levied by U.S. President Donald Trump last year bar U.S. banks from carrying out financing operations with Venezuela, meaning such swaps cannot be renewed. "Citibank got paid," said a local finance industry source familiar with the negotiation who asked not to be identified.

Three hedge funds that own defaulted Venezuelan bonds hired a Washington law firm to explore legal options for repayment, Bloomberg News reported. The group owns more than 15 percent of the $1.5 billion outstanding of Venezuela’s 2034 bonds, according to Mark Stancil, the attorney at Robbins, Russell, Englert, Orseck, Untereiner & Sauber LLP who’s representing the investors. Stancil declined to name the companies. He helped represent hedge funds Aurelius Capital Management and Davidson Kempner Capital Management in their lawsuit against Argentina.

Bahrain should consider implementing corporate income tax to shore up its finances as rising interest rates hinder its ability to borrow, the International Monetary Fund said. “Notwithstanding notable measures implemented since 2015, a credibly large fiscal adjustment is a priority,” the IMF said in a report dated May 30, Bloomberg News reported. “The implementation of a value-added tax, as planned, would be important.

Reliance Communications Ltd. soared in Mumbai trading after it settled a payment dispute with the local unit of Ericsson AB, allowing the debt-laden phone operator to proceed with a planned asset sale to Reliance Jio Infocomm Ltd. and possibly stave off insolvency, Bloomberg News reported. RCom, as the company is known, advanced 6.6 percent to close at 18.65 rupees in Mumbai after jumping as much as 20 percent in early trading on Thursday. Its 6.5% bond maturing in November 2020 rose 4.3 cents on the dollar to 56.55, according to prices compiled by Bloomberg.

Cambridge Analytica, the U.K. political consulting firm that closed its doors after a scandal over how it harvested data to influence the last U.S. presidential election, now faces a group of Facebook users in its bankruptcy, Bloomberg News reported. “Data Breach Plaintiffs" filed a notice on Tuesday to appear in the company’s New York bankruptcy. The group is involved in two lawsuits against both Facebook and Cambridge Analytica that seek class-action status on claims that about 87 million Facebook users had their personal information taken without permission.

Prime Minister Narendra Modi’s ambitious plans to privatise major parts of Indian industry were left badly diminished on Thursday after the deadline for potential bidders to express an interest in Air India passed without a single company doing so, the Financial Times reported. Mr Modi had prioritised selling the highly indebted airline in what would have been India’s biggest ever privatisation and a powerful sign of his commitment to economic reform.

Lebara, the telecoms company that has already missed deadlines to file its accounts, has promised to buy back a small portion of its distressed €350m bond in exchange for more time to file audited results, the Financial Times reported. The value of its bond has plummeted in recent months after errors in its financial reporting which Lebara’s management described as a “genuine mistake”. The company sells low-cost international phone calls across Europe and is known for adverts that line many of London’s newsagents.

Abraaj is meeting with creditors next week as the Dubai-based private equity company attempts to avoid potential liquidation proceedings that have complicated talks to sell to a strategic investor, the Financial Times reported. Kuwait’s Public Institution for Social Security (Pifss), one of its creditors, has filed a petition to liquidate Abraaj’s assets over its inability to repay a $100m loan due Sunday. Abraaj has been rocked since investors complained that it had mishandled money in its $1bn healthcare fund.