The Week Ahead: City gears up for mega-floats of Standard Life and Rosneft

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The Independent Online

The week will start and end with two juggernaut flotations. Standard Life is primed to list tomorrow, and the Russian oil giant Rosneft's controversial float is setting sail on Friday.

The pricing for Standard Life's shares was set at 230p late last week, at the lower end of original exceptions. The former mutual insurer, which has a market cap of £4.65bn, said there had been "significant over-subscription" for the float. Its 2.4 million eligible members will receive shares worth an average of £1,475 each, with a minimum payout of £425.

The other important date this week is 12 July, a crucial deadline for the troubled Channel Tunnel operator Eurotunnel. It is locked in talks with bondholders over the refinancing of the company, which is saddled with heavy debts. Although the bondholders and management are creeping towards an agreement, chief executive Jacques Gounon has warned that, should a deal not be struck by Wednesday, he will put the company into administration at the extraordinary general meeting later this month. The two sides are due to meet on Tuesday to try to thrash out a solution.

Most of this week's other meetings are set to be calmer affairs - though not, admittedly, if the shareholder group Pirc has its way. As the UK AGM season gets under way, it wants a number of companies - Marks & Spencer, BT, Man Group, Emap, Burberry, British Land and EMI - to face the music over pay deals and incentives for senior executives, directors and auditors.

J Sainsbury is also in Pirc's sights due to misgivings over the retailer's remuneration packages for executives, in particular its boss Justin King. Pirc says that Sainsbury's has failed to balance incentives and rewards with provision for the loss of senior executives.

The market, meanwhile, will be closely watching any commentary from Sainsbury's after it delivered a 5.7 per cent rise in like-for-like sales in the first quarter on the back of the World Cup and good weather conditions. However, some analysts are warning there may be scope for disappointment in the second quarter as Sainsbury's may no longer be able to rely on these positive drivers.

M&S faces similar issues to Sainsbury's; its remuneration policy has caused some concern, and investors will be keen to hear if its strong sales are continuing.

"This time last year sales were just starting to pick up," said Jeremy Batstone at broker Charles Stanley. "Now it's picked the low-hanging fruit, it will be interesting to see if M&S can keep on reproducing strong growth."

The retailer will be releasing first-quarter figures, with some in the market looking for a rise of around 10 per cent in like-for-like sales, along with market share gains in clothing.

Fellow retailer GUS, which last week revealed it had knocked back separate offers for both its Argos business and its credit group Experian, will update the market on Wednesday. The City will be keen to find out which companies have approached GUS and how much they were prepared to offer, though few are expecting the management to be forthcoming.

Trading at GUS's Homebase stores is expected to have been tough, while sales at Argos are tipped as being from flat to slightly negative in tough conditions. But consumer electronics sales are likely to have fared better due to demand for such products as flat screen televisions.

Burberry's first-quarter sales, meanwhile, are expected to have jumped 10 per cent to £125m, with retail sales predicted to be up as well, to £75m, according to analysts at Goldman Sachs.

From fashion to bourses - the London Stock Exchange will hold its shareholder meeting on Wednesday, when it is likely to be upbeat about trading activity. It may also comment on the spate of consolidations among global indexes and on its rebuff of potential partners such as rival Nasdaq and Macquarie Bank.

3i is another group that may be under pressure to talk about future deals at its AGM after it walked away from a bid for AB Ports last month. Charles Stanley's Mr Batstone believes 3i is likely to be gearing up for another round of investments.

Another global giant holding its annual meeting this week, this time in the realm of hedge funds, is Man Group. Investors will be keen to hear whether it can sustain its strong performance so far this year.

Sticking with monolithic stocks but switching to telecoms, BT is holding its AGM. It is expected to reiterate its confidence in its ability to weather intense competition in the broadband arena from the likes of Carphone Warehouse. Investors will also be looking for confirmation that BT is on track to carve out £1bn in cost savings to help it produce an annual pre-tax profit of £2.37bn, up from £2.04bn.

And, finally, there's BAA, which has postponed its annual meeting next week following its takeover by Ferrovial. It will, however, release monthly traffic figures from its airports; the market is expecting a 3 per cent rise year on year.

CALENDAR

Tomorrow 10

UK RESULTS: (final) Proventec; (interim) St Modwen Properties.

Tuesday 11

UK RESULTS: (F) Air Music and Media, Anite, Inter Link Foods.

Wednesday 12

UK RESULTS: (F) Avocet Mining, Bespak; (I) Kensington.

Thursday 13

UK RESULTS: None scheduled.

Friday 14

UK RESULTS: None scheduled.

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