The Week Ahead: With this ringtone... NTL and Virgin Mobile to wed at last

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The Independent Online

If you had been holding your breath for NTL to finally launch its offer for Virgin Mobile, you'd be dead by now. This £970m deal first surfaced at the end of November, and was agreed in principle when Sir Richard Branson said he'd take less than other investors to push it through. Meanwhile, NTL had to complete its merger with Telewest (another deal that took for ever), and that had to be restructured for tax reasons. This week, the marriage should finally take place - valuing Virgin at 372p a share.

Signet, owner of H Samuel and Ernest Jones jewellery chains, has for years now been seen as a company divided between the flourishing US unit and its ugly UK sister. When it reveals its annual results on Wednesday, the diverging fortunes of its businesses will be thrown into even sharper relief.

Panmure Gordon is expecting the group to report a 15 per cent yearly rise in operating profit for the American business, which includes Kay Jewellers, and a 40 per cent drop in operating margins in the UK as the sluggish retail market continues to drag it down.

"In a nutshell, what they've made on the one hand [in the US] has been given back with the underperformance of the UK business," said Justin Scarborough of Panmure Gordon. The results could kindle talk among investors, which has bubbled up from time to time, that they may be better served if the group split itself into two companies.

"There is no great reason that the UK and US operations should be combined under one group," Mr Scarborough said. He expects the company to unveil £196.6m in pre-tax profits, down from £220m the year before.

Speaking of retail, the maligned UK consumer will be a topic of conversation when the Bank of England's Monetary Policy Committee meets for its monthly pow-wow on Wednesday and Thursday to decide on interest rates.

"The consumer is really key for the prospects of the UK economy," said Philip Shaw, an economist at Invesco. For the time being, the retail malaise looks set to continue, with household budgets being stretched by rising utility bills. "They [consumers] don't really have the motivation or the resources to go on a spending spree," Mr Shaw said.

Overall, however, the economy continues to trundle along, performing neither well enough to raise inflationary fears nor poorly enough to trigger calls for a rate cut. Indeed, all signs point to the MPC keeping rates steady at 4.5 per cent for the eighth month in a row.

Only one of the committee's nine members, Steve Nicholl, voted for a cut at last month's meeting. "There is no inclination from the other members to move rates in either direction," Mr Shaw said. He believes that the MPC will keep rates unchanged for the rest of the year.

Finicky they may be, but one thing UK consumers can't seem to get enough of is Harry Potter. Bloomsbury Publishing, which prints the children's series, is set on Tuesday to stick to its prediction in January that pre-tax profits for the year would be £20m.

The company has benefited from strong sales of Harry Potter and the Half-Blood Prince, J K Rowling's latest book about the adolescent wizard, which was released last year.

Resolution, the closed life insurance funds specialist, will also publish annual results on Tuesday, when its chief executive, Paul Thompson, can expect to be grilled by analysts about the company's prospects for buying more closed funds. These are groupings of already-sold life insurance policies that do not accept new customers.

The company's name was floated last week when Equitable Life, Britain's oldest mutual insurer, said that it was in talks about a takeover without identifying the potential bidder. Barclays estimates the global closed-life funds market to be around £200bn, so whether Resolution is interested in Equitable or not, there is plenty of room to run.

The wrangles between Wal-Mart-owned Asda and the GMB are set to continue this week. The union announced that a ballot on industrial action would be held at Asda's 21 depots starting on 24 April. The results will be due back a few weeks later - meaning the retailer could be hit by industrial action as early as the end of May.

Wal-Mart isn't the only company to be tangling with unions these days. Workers at Aer Lingus, the soon-to-be-privatised Irish national airline, don't have veto power but have threatened action if they deem that the float will hurt workers' interests.

The rhetoric is sure to heat up since the Irish Transport Minister, Martin Cullen, said last week that the privatisation could take place as early as June. The decision about how and when it will happen is set for the coming week.

CALENDAR

Tomorrow 3

UK RESULTS: (final) Headlam, Integrated Asset Management, Phoqus, Whatman; (interim) Egdon Resources

Tuesday 4

UK RESULTS: (F) Alea, Bloomsbury Publishing, Cellcast, Empire Online, FDM, Havelock Europa, MSB International, Plethora Solutions, Resolution; (I) Bellway, Next Fifteen Communication

Wednesday 5

UK RESULTS: (F) Boot (Henry), Cyprotex, Signet; (I) Manganese Bronze

Thursday 6

UK RESULTS: (F) Chelford, VI; (I) Air Partner, Charteris, Innovation

Friday 7

UK RESULTS: (I) Pavilion Insurance Network

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